A time capsule of the greatest financial mania in the history of mankind, told in real-time by regular folks and patriots. May future generations better understand the madness of crowds, and how power and money corrupt.

October 12, 2007

This is from the discredited ramen eating kool-aid drinking Phoenix realtor blogger who shall remain nameless (no name, no link = no traffic to his god-awful blog), but longtime HP'ers all know and loathe. Have a good laugh! Actually, have a fall-down-the-stairs kind of laugh! Thanks pm for the lead!

September 2005, Phoenix ArizonaHow rich would you like to be?

In the 12 months leading up to August 1, 2005, single-family residences in the Metropolitan Phoenix/Scottsdale market appreciated by an average of 47%. That's the average, and it includes challenged neighborhoods and cities so remote as to qualify as rural.

If you look at just the sweet spot, the middle of the bell curve, Phoenix/Scottsdale-area homes appreciated by 60%, 80%, over 100% in some areas.

Price pressure has not slowed down, and there are good reasons to believe that appreciation over the next 12 months will be 20% or more, possibly a lot more.

We have a built-in baseline demand from the Great Lakes and other snowy regions. And we seem to be experiencing a steady increase in our long-term in-migration from California.

Our best estimate right now is that annual appreciation over the next seven or eight years should average out to around 11%.

.. If you can make that down payment, or if you can absorb a negative cash-flow from other sources of income or with a negatively-amortized loan, your ability to build long-term wealth in the Phoenix residential real estate market is tough to beat!

hahahaha... this ignorant pig reminds me of "15% in the bag appreciation" gary watts -- another ignorant realtor who claims to be an "economist". Yeah, right... he probably got his degree online. I keep his old report around just for laughs. Once in awhile I pull it out and read it to remind me that pride & arrogance comes before the fall.

We all know how the PHX market's doing these days don't we? Yeah. Tremendous price declines hidden from the MLS data in the form of "incentives". Following that advice at that time int he over-priced mkt would send you straight to the poorhouse. Any of your old clients thanking you for that prescient "buy cash-losing investment properties hoping for the appreciation to bail-you-out in the end when you sell?"

Is that why you are blogging about all this tech stuff? Trying to avoid recognizing the fallout from your realtor-games and the following RE speculation?

You can dismiss your critics as flying monkeys- whatever. But you really screwed over anyone who took that advice to invest in rental properties that were cash flow negative. And the signs of an impending collapse were right there for you to see- even noted in your piece.

Look up "minsky moment" with the term "Ponzi Borrowers" :"borrowers who can’t pay the interest, let alone the original debt, and rely entirely on rising asset prices to allow them continually to refinance their debt.

"built in baseline demand from the Great Lakes"? What a joke. The retirees up here can't sell their homes and are stuck. Many of them are having to cut prices drastically just to get rid of their homes so they can leave. They'll hardly be able to pay top dollar in the Sun Belt after having to take less than they budgeted for their homes sold up here. What a laugh. I know of folks who haven't been able to sell their home in two years.

Right now, our leaders are propping up the system because they still can. When the load becomes too heavy, the house of cards will collapse. Cash sloshing around will instantly disappear as banks recall their loans, no one wants to touch asset-backed stuff with a 100 foot pole and deleveraging ravages our confidence based system.

RE: .. If you can make that down payment, or if you can absorb a negative cash-flow from other sources of income or with a negatively-amortized loan, your ability to build long-term wealth in the Phoenix residential real estate market is tough to beat!

Sounds good to me.

Down payments and negative cash flow can be easily handled with credit cards and HELOC loans on daisy chain home purchases.

The Snow Birds and Cali-folks he...( respecting the fact that you didn't want to use his name) was talking about were not new residents, although stating the contrary on thier "liar loans" they were classic FLIPPERS, ie. Casey Serin and company.

Today we all know they are walking away in droves claiming to be victims.

Maybe that bloodhound can sniff out the culprit!

I predict that the ugly duckling will find some excuse to leave Pheonix soon.

The Snow Birds and Cali-folks he...( respecting the fact that you didn't want to use his name) was talking about were not new residents, although stating the contrary on thier "liar loans" they were classic FLIPPERS, ie. Casey Serin and company.

Today we all know they are walking away in droves claiming to be victims.

Maybe that bloodhound can sniff out the culprit!

I predict that the Ugly Duckling will find some excuse to leave Pheonix soon.

Since the Dow is such a broadly-watched barometer of American "wealth", it will probably be propped up at all costs.

Actually, it IS BEING propped up at ALL costs. Such is the political power of the crybaby Wall Streeters.

The "all costs" part is the destruction of the US dollar, and the US economy along with it. All to create the appearance of wealth, much like getting into negative amortization loans to "own" property and appear wealth.

What you want to do is trade in a market where you can freely go long and short, and cancel out losing trades with winning trades, plus a little extra, again and again.

This is now being practiced in several fully automatic ways. Wall Streeters and hedge fund managers don't want you to know about the existence of this technology, because it will steal business from them. But it exists and is highly profitable and getting to the point of being NEARLY idiot-proof.

However, idiots tend to not have enough money to trade with, nor do they think for themselves, so these tools and techniques remain under the radar, for now.

How about Gary Watts, who said "15% (appreciation) is in the bag for 2006"? I present his prediction for 2007, from February:

'Gary Watts, the Realtor-economist who forecast the downturn of the 1990s, then foresaw the housing boom just ended, believes prices will rise slightly in 2007.

Although his 2006 forecast was overly optimistic, Watts remains confident that local house prices this year will increase 7 percent and that condo prices will go up about 4 percent.

...

"This will be, I think, a pivotal year," Watts said in a telephone interview. "If the housing correction is behind us, we'll be in pretty good shape. We've weathered the worst."

Watts, who is delivering his forecast in a series of speeches to Realtor groups this month, originally forecast that Orange County home prices would rise 15 percent to 18 percent in 2006, then revised that forecast down to an increase of 8 percent to 9 percent.'

More big plans from Swann that obviously didn't work out, thought he'd make $10 million and instead probably going bankrupt!

http://www.bloodhoundrealty.com/BloodhoundBlog/?p=766

Here’s a true fact of life for almost everyone with a real estate license: This job pays really badly.

Here’s a true fact of life for a favored few people with real estate licenses: This job pays really well.

I don’t know if we can safely count ourselves among the favored few just yet, but being Realtors is throwing off a lot of cash for us, and that cash is throwing off a lot of opportunities to make more cash.

Last year was phenomenal, of course, and this year hasn’t been awful for us, considering how awful it was for other Realtors in Phoenix. We got a lot choosier about listings, which helped keep our money in our pockets, and we’ve both done more than we ever have before with new builds.

But: Do Realtors “deserve” all the money they make? I’ve had transactions — two closing later this month — where my total involvement was around five hours. I’ve had others that have run to hundreds of hours over the course of years. But looking at my added-value by hours or tasks or ergs of energy expended is a mistake. The value I bring to the transaction comes from knowing what to do, how, when — and why. Our clients do a lot better because of our involvement, and they are gracious enough to say so.

In the near term, I think we can double our numbers to something like $1.5 million a year, before taxes and expenses. From there, with a couple of assistants each, we might be able to push things to that amount, gross, each. In other words, without growing our head-count very much, we might be able to knock down $3 million a year in gross commission income. The net from that might not be all that great, considering, but it will still be a lot of money.

So: What are we after? Money. We love our clients, and we love helping them achieve their real estate goals. But if this job didn’t pay this well, we would be doing something else that either paid better, provided actual benefits or left some time free for other pursuits. We’re doing this — and we’re dancing as fast as we can — so that one day we can stop doing it.

How much is enough? Right now, I’m thinking around $10 million in net worth. That sounds like a lot of money, but it doesn’t feel like it to me from here.

How much is enough? I think something like a hundred million packages of Top Ramen oughta do the trick…

Realtor says:We have a built-in baseline demand from the Great Lakes and other snowy regions. And we seem to be experiencing a steady increase in our long-term in-migration from California.

Frank says:Right there he explained why the bubble would burst - those people were only attracted to Phoenix for cheap banal living. Once the cheap was gone, no more transplants especially from California.

I think both of these statements miss the most obvious reality of all: all of the retarded "reasons" these morons came up with for Phoenix's housing mania were ALWAYS there. There is nothing about the historic trend of immigration to Phoenix that changed in the last several years (certainly nothing to come anywhere near explaining 100% price increases). Whenever these idiots laid this crap on me I simply asked them "so why didn't these amazing price increases occur every year for the past 50 years?", at which point they would just twitch and change the subject (actually answering questions is beyond them as well).

The first thing one should learn when trying to understand the world is that most people are delusional and selfish. They believe something because they want to and because it benefits them, not because it is true.

Anyone who reads his writing can tell he's as dumb as a rock. Anyone who incessently has to over-thesaurus their words to make their writing sound intelligent is just a pompous mental midget. It reminds me of these new economy dipshits that use jargonized buzzwords like "leverage" and "incentivize".

Oh well, I guess when you can't do anything else in life you become a realtor.

Realtors, hookers, drug pushers all of one thing in common: either a complete lack of education or uncontrollable greed. It's hard to discern which.

On the one hand one would think lack of education. How could one believe home prices could ever, EVER, rise faster than personal income growth? On the other hand we have the clueless GED with her face plastered on the local metro bus.

An even mix? Some of both? At any rate they're all buggy whip salesmen. I need a realtor like I need a banker to make a withdrawal.

What a clown,oh but really, I didnt know trees grow all the way to the sky.I hope he took his own advice and bought 20 overpriced negative cash flowing crapboxes. Hopefully with reverse amortization exploding arm loans to boot.I live in California, and the ONLY reason people I know moved to phoenix was for cheap housing, but now houses here are falling, some places are half off, so there's no incentive to move to a hellhole anylonger.

Obviously, I consider this a profoundly silly question, but to lurk among the BubbleBloggers and their seething commentariat is to acquire an education in a slice of America invisible from this side of the sewer gratings.

Notwithstanding the idiotic economic analysis, which is really no worse than the static-market fallacies paraded as profundities in the pages of the Arizona Republic, these sites — and not just HousingPanic — are infested with a cult-like fever to inflict suffering — at second hand, to be sure — on people who are in fact guilty of nothing except failing to have drunk the BubbleBlogger KoolAde.

That’s all one. I don’t care. The whole of the last century was dominated by the bad behavior of viciously angry wretches, but look where it got them. The BubbleBloggers will someday bawl balefully in private, but they will never, ever admit that they have been very publicly very foolish. You will know and I will know and in the secret chambers of their hearts they will know they were wrong all along. But as long as you don’t hold your breath waiting for that contrite admission of error, you should be fine.

Here’s where I do start to care. Whenever the subject of Phoenix comes up in a BubbleBlog, the assembled Brown Shirts pile on, for whatever reason. This is their perfect right — even though I think they’re wrong. I love this place. I came here for three months in 1988, and I could not wait to get back. The first time I set foot here, on March 13, 1988, I knew I was home. We moved here for good on April 1, 1991, and I cannot imagine living happily anywhere else. Our relocation page is my extended love letter to the Phoenix area, warts and all. I’ve been writing lovingly about this place since the day I got here, and I’ll keep it up at least until the day before I die here.

Which brings me back to HousingPanic’s question. We keep our own home sales price statistics, so we have no doubt that values are down from their high in December. How much? Right now, about 4%. Could they go lower? Certainly. Will they drop by the huge amounts HousingPanic and his flying monkeys seem to yearn for? This seems very unlikely.

probably cost myself a fortune in free grapefruits in phoenix, but the seedy white ones can produce hundreds of seedlings every year that in hard times the refuse can be turned into mash for distilling? into gasolines....yet think how pleasant farm labor is almost anwhere in the U.S for 7 months of the year.. if you consider yourself a phoenix farmer...